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What We Learned From The Global AR Online Pitch Event

Fredrick Gran (Analyst)

It has been three months since the eight finalists of the first-ever Global AR Online Pitch Event were announced. Our goal was to give early-stage augmented reality companies around the world the opportunity to pitch key Silicon Valley investors without spending the time and money required to go on a roadshow. Our hope was that a leaner approach to a pitch event would put the startups on a level playing field, letting the entrepreneurs, their vision and innovation speak for itself. The results are now in and we hope to do more events like this in the future!

In total 241 augmented reality startups from 35 different countries across all continents entered the competition. Our belief is that this gives us a somewhat representable picture of the rapidly growing augmented reality industry today.

Augmented Reality Is Truly Worldwide

The Global AR Online Pitch received applications from AR startups from all 5 continents, 35 different countries and 94 unique cities. North America is clearly the leading region, with about half of the startups situated in the United States. California accounts for about half of the US startups, but outside of California startups are rather spread out. This is sort of good news for all of us situated around San Francisco/Silicon Valley. But the reality is that only 18% of the companies were situated in San Francisco/Los Angeles. In other words, there are really interesting things happening outside of our little bubble and this is exactly the opportunity we hoped to tap into and uncover with this event.

Following our applicant demographics, half of the finalists were from the US, but the other half are from important international AR hubs, such as London and Vienna, in addition to smaller AR hubs like Amsterdam and Melbourne, Australia. We also had really strong applicants from Buenos Aires (CamOnApp), Toronto (xesto), South Korea (ANIPEN Inc.) and Israel (Camerai and RestAR).

Our goal was to give innovative early-stage augmented reality startups worldwide the opportunity to pitch key Silicon Valley investors and we believe we succeeded in this. We are also confident that the startups and investors agree. According to our survey among the finalists, the startups were satisfied with the event and found it helpful, especially the investor mentoring provided. The entrepreneurs indicated that they would very likely recommend the Global AR Online Pitch to other startups. The average finalist met six investors after our event, and at least three of the finalists have received seed funding as a result of the event. The feedback from investors has been overwhelmingly positive as well. All were “very satisfied,” finding the event very useful and would very likely attend the next Global AR Online Pitch Event.

Funding Stage

We have also been looking for other patterns among the companies that participated. Most of the companies were pre-seed, but with a solid portion of seed stage companies and a few series A companies. This event format obviously appeals strongly to companies at pre-stage, but it’s also a good sign of growth in AR. Among the finalists, five were pre-seed, two were seed and one series A, indicating that investors are interested in companies at all early stages of funding.

Business Model

It was pretty much a 50/50 split between B2B and B2C companies, with a small amount of B2B2C companies among the applicants. Among the finalists, six companies employ a B2B model compared to only two with a B2C model. In other words, arguably investors are favoring B2B models. There are two main reasons for this: 1) Hardware for AR is still too expensive for consumers and 2) the revenue from B2B models is currently stronger and more predictable - the risk associated with B2C AR solutions for an investor are just much higher.

Gender Diversity

Disappointingly, only 19% of the applicant companies had a female founder/CEO. We are convinced that there are many more exceptional female AR entrepreneurs out there. If we are able to tap into this potential, we strongly believe that there will be even more great AR companies. Among our finalists, 2 out of 8 (25%) had female CEOs, and we are confident that if we get more female applicants we will see this number rise. To achieve this, we strongly encourage women in AR, and/or any other frontier tech, to reach out to us.

Product Category

By category, there was no particular bias and there was a wide distribution among the categories. However, the two categories “Application (Consumer)” and “Application (Entertainment, Game)” account for almost 1/3 of the companies who applied. This is probably related to the recent releases of ARKit and ARCore. The most profitable category right now is applications for enterprise, which makes it a bit surprising that only 13% of the companies are within this area. Also, although “Infrastructure (Technology, Tracking, SLAM, AR Cloud, etc.)” is currently the most active investment area, it only accounts for 9% of the total companies that applied, contrary to expectations among investors.

The Global AR Online Pitch was a great success. We got to see a lot of really interesting companies, and we learned a lot about the current AR landscape. Huge thanks to all the startups and investors that participated. I hope the lessons we have learned will be useful to all the interested parties. Looking forward to updating you after our next online pitch event!

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